An Attempt at a literature review of “The Market for Lemons” Theory and a Case Study in Algerian Local E-commerce

This paper attempts to understand the theory of “the market for lemons” proposed by the American economist Akerlof in 1970, review some related works, and apply this theory in an Algerian context. The theory of Akerlof is key to the information economy. One of the first pieces of research that defined adverse selection is when the two parties in a transaction have different levels of information. We present our example, not well established in the literature, of asymmetrical information in the local e-commerce market, which explains the e-sellers problem with e-customers behaviors. We describe the impact of such issues, such as the loss of e-sellers caused by behaviors of e-customers, and propose solutions based on the literature. Finally, we are beyond reviewing such landmark research or adding anything to it, related works are not fully discovered, and we present a humble piece of research that may exhibit any flaws.